Malaysian Banks Competitive Advantage Through Merger and Acquisition

• Main Author: Anis Farida, Md Rejab
• Format: Thesis
• Language: English; English
• Published: 2011
• Subjects: HG Finance
• Online Access: https://etd.uum.edu.my/2716/1/Anis_Farida_Md_Rejab.pdf; https://etd.uum.edu.my/2716/2/1.Anis_Farida_Md_Rejab.pdf; https://etd.uum.edu.my/2716/

We analyze the determinants of Malaysian banks competitive advantage by using a sample of nine local commercial banks operating in Malaysia for the period of five years, from 2005 to 2009. The main objective of this study is to determine whether merger and acquisition increase competitive advantage among banks, to explore the relationship between cost leadership, differentiation, focus and market capitalisation to the bank's competitive advantage and to document the strategies adopt by banks in order to stay competitive and survive. This study has chosen trend analysis, descriptive analysis, correlation analysis and regression analysis to identify the determinants of the competitive advantage of local banks in Malaysia. The dependant variable is competitive advantage (measure by profit before tax and zakat), where for independent variables are cost leadership ( measure by profit margin ratio and net income to total employee ratio), differentiation ( measure by size of total assets), focus (measure by profit from conventional banking) and market share (measure by market capitalization and loan to deposit ratio). By doing this research, we can conclude that local banks in Malaysia gain competitive advantage after merger and acquisition. As the profit and market share by each bank increase, it will help the bank to increase their competitive advantage.